Dr. Petri I. Salonen Views on Life, Entrepreneurship, and Software Business

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Cloud ISV: What technology will you be using when supporting different mobile and tablet devices?

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I explained in my previous blog post that the cloud era is here to stay and with this new era, there are also quite a few technologies that the ISV has to select to build a solution. One key thing is to select the cloud platform but an increasingly important technology that the ISV has to evaluate is what development environment to use to support hundreds of different mobility devices, both smart phones as well as tablets.

When I look back not more than five years, the requirements for applications were much different that today when it comes to consuming information. Today, the end user expects to be able to use a smart phone and tablet to view/update information using a solution that typically is built on cloud technology. Flash used to be the main technology to build applications for the Internet browser, but with the decision that Steve Jobs and Apple did on Flash of not supporting Flash on Apple iPad, the success of Flash is doubtful in the future. Consumers do not care about technology, they care about having the ability to consume information and this is something that the technology industry forgets every now and then. If somebody has any doubts about this, just look at what is happening on the US markets and what has happened for example for RIM and BlackBerry market share on smartphones. It is brutal.

Back in 2010, there were quite a few articles of whether HTML5 will kill Flash. There are millions of Flash web sites whereby I do not think Flash will go away anytime soon, but the real question is whether the ISV should believe that Flash is going to survive going forward. My personal opinion is that I would not invest time and money to Flash anymore as we all know it is not going to support all of the relevant mobility interfaces and I do not think that for example RIMs approach by marketing its BlackBerry PlayBook to support Flash makes a difference in the large scheme of things. The question that each ISV needs to evaluate is what technology it expects to support from a long-term application development perspective.

We already know by now, that Flash will not survive in the long run and has already become a major limitation for many ISVs. When you really think about it, users have already won the battle by ignoring the Flash and showing this by buying iPads even if they know it won’t support Flash. Can you afford building sites and ignore the millions information consumers? I do not think so. Many entrepreneurs (me included) have made the decision not to allow any Flash technology  to be used on the web-site as most smart phones and tablets do not support Flash and Flash not optimized either from SEO and SEM perspective. Check your web site analytics/statistics and you will find out that smart phones and tablets are becoming more relevant in information consumption.

I believe that the next wave of innovation will be coming from software vendors that are able to combine the cloud and mobility in a way that helps end user organizations to become more effective and productive in whatever the application area happens to be. I read an interesting article “Building An Enterprise Software Company That Doesn’t Suck” where the author described how large enterprise software packages are losing the appeal from both end user organizations as well as users. People are sick and tired of complicated and hard-to-use software solutions that do not bring any value add to a user’s daily life. Organizations have forced users to use software to fulfill some type of compliance rule but I my bet is that with the new generation of users, this will change whether organizations want it or not. The new generation entering the marketplace is fluent mobility users, they use social networks as we used to use the regular phone and they would not care less about the corporate compliance stuff and based on research, they won’t even apply to organizations that are old-fashioned way of viewing the world.

Technology selections for an ISV business is always tricky and I have had to do this many time during my career and I have also had a few misses such as selecting an application development tool from Synon (acquired by CA) called Obsydian that never really took off in the marketplace and my developers were never really able to use it effectively. The same applies to the selection today in respect to mobility development. Can you afford making a mistake, spend money in development and then suddenly realize that something else should have been used. I do not think so.

I recently read an interesting article “Seven Reasons HTML5 is Killing Flash” with some interesting points of why HTML 5 could potentially kill flash. According to the article, there are more than 109 million mobile users with HTML-5 ready browsers, but by 2016 the estimate according to ABI Research is that there will be more than 2.1 billion mobile users with compatible browsers. According to ABI Research, there will be 25 key features that will make HTML 5 competitive and the seven that was picked in the article are as follows:

1)      Video Play: HTML5 includes a tag for videos that allows it to play with the start, stop, pause etc.

2)      Video Record: This will become even more important going forward as mobile phones have video recording and HTML5 will support this

3)      Audio Play/Record: Today, the user needs, Flash, QuickTime or Java to play or record audio, but with HTML5 it is just another tag.

4)      Apps: HTML5 allows Web pages to access the same routines that make browsers work and enables them to become like any application. I think this is one of the key things when you think about mobile application development using HTML5

5)      Rich 2D Graphics: All types of sophisticated two-dimensional graphics will be built into HTML5

6)      IM: Instant messaging will be built into HTML5 by virtue of Web sockets

7)      Real-time Streams: Web sockets will also allow any Web-page designer to easily add real-time data streams to the application.

HTML5 could become the best friend for the ISVs going forward as it will provide the broadest support from a device/browser perspective and when smart phones will get HTML5 compliant Internet browsers. HTML provides a better way to support multiple devices as is explained in the article “Enterprise App Stores Harness HTML5” by Colin Johnson.

Software solutions we are using on a daily basis when running a consulting business with people distributed in different parts of the world

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I get questions from other entrepreneurs what software we are using to run our business and it has been my intention for a while to create a blog entry about this and I finally got to do it so here it is.

I founded TELLUS International six years ago after having been part of a software company exit (sales of a software business intelligence company). When founding TELLUS, I made a firm decision not to invest any money in hardware which forced me to select solutions that would run as a cloud solution (SaaS).  This was a pretty bold statement back in 2005 as the cloud really became reality and part of “accepted” much later and there really wasn’t that many SaaS solutions back then.

Throughout this blog entry, you will see that solution integration plays an important role when running a business. Integration is by far the most important thing that an organization should pay attention to. You do not want your personnel having to re-enter things to many applications, the focus should be on sharing information across different applications. For us, Microsoft Office Suite with Microsoft Word, Excel, PowerPoint, Project, OneNote etc. are obvious selections for the office productivity tools but all fo the data and documents have to live in the cloud.

There are some applications that are better suited to run as desktop apps with the ability to save data to the cloud and therefore I really see a hybrid model to be the case in many solution areas and I have some examples of this later in this blog entry. If we work in Microsoft Word, the document will be saved a cloud vault so nothing will be lost even if the laptop/desktop fails or hard drive goes bad. In our case, M-Files document management solution was the right choice due to many reasons that I explain later in this blog entry.

Let me start this journey by working through each operational area where software is needed. I will start by looking at company accounting as that is what is usually needed immediately after the company has been created. You could potentially keep your books using Microsoft Excel (I have seen this happening as well), but I decided to base my company on a real foundation from get-go and Excel was not the solution for TELLUS accounting and was not cloud based either.

Accounting in the cloud back in 2005

Back in 2005, the only real SaaS vendor for accounting was Intuit with QuickBooks Online and that is what we have been using from get-go. I had exposure to QuickBooks Online already before 2005 when I was running a business intelligence software company so I knew what I was getting myself into. The reasons why we went initially to QuickBooks Online from regular QuickBooks was due to the need to share financial information with the headquarters in Finland. A SaaS solution enabled any user get immediate access to the books. What a great concept and Intuit was the first one to get a SaaS solution to the marketplace.

The benefits of having accounting in the cloud are many such as:

1)      I can have my CPA review on my books anytime, anywhere without me having to worry about hardware or software to be installed.

2)      I can generate invoices and have people to enter their time for billing purposes just using the browser

3)      With the mobility era coming even stronger, the mobile interface to QuickBooks Online are getting even better what it is today.

Communication tools with the external world

As a Microsoft partner it was very natural for us to select Microsoft-hosted Exchange environment for our email needs. We have been using Microsoft-hosted version since it came out and could not be happier. The environment supports different types of mobile devices as well and which is the reality of many organizations today. The days when everything was standardized into one specific device are gone.

Document Management Solution – Getting documents and workflow processes into control

A key part of any consultancy is to standardize how documents are managed, where they are saved and what type of workflow processes are attached to different document types. During the past six years we have tried many solutions and luckily I was able to find something that not only made sense to the users, but also supported my vision of having a cloud-based solution for our document management. The solution is M-Files with Windows Azure backend (storage) and a small plugin that enables fully integrated user experience when working with Microsoft office environment. Let me explain what I mean by fully integrated document management experience.

First of all, the end user does not have to think about document management when using M-Files.  M-Files is like a drive on a laptop/desktop with the difference that the user does not have to worry about directories or file naming when saving the document to the M-Files Azure repository. The user is presented with a metadata card that includes information for that specific document type (document class) and this is much more meaningful to the user as everything then becomes searchable and structures can be changed without really having to think about directories. How many times have you wondered where you saved a document and whether the document is the last one that has been touched? According to some studies, a document exists on average 19 times in a typical corporate environment. What a horrible way to spend money and time for nothing.

In our case, we have also integrated M-Files with Dynamics CRM 2011 Online environment with full two-way synchronization. What this mean in practicality is that all customer names and contacts are automatically synchronized from Dynamics CRM 2011 Online to M-Files Windows Azure repository. The synchronization is two-way where any change in M-Files is automatically synchronized back to Dynamics CRM 2011.

The reality is that all of us use Microsoft Office as the main environment when working with documents and what M-Files brings to the table is a native plugin to each one of these apps, including Microsoft Outlook: each application has a button to save the document to the M-Files Azure Document Vault and that is very powerful. Nobody in the organization has a need to explain that he/she does not have time to save documents, because the effort is in fact less as the document metadata card is automatically driving the saving process.

We also use the workflow engine in M-Files to drive our approval processes in proposals which is important to keep the quality high on the documents that are sent to the prospects.

If you reflect on the text above about how we integrate things within our organization it is easy to say that M-Files is almost like the traffic controller sitting in the middle and documenting what we are doing. We have seen many organizations with disintegrated applications with lots of re-entry of data and that is not only useless but also frustrating to the end users.

On top of the integration capabilities between M-Files and other operational applications on the metadata and metadata related records, any document that flows through any of the employees will have metadata associated to it and any document will have full support to audit trail as well as company/contact information associated to it. M-Files enable organizations also to integrate the solution into ERP/accounting database whereby M-Files really becomes the central hub for any information flow.

Sales and Marketing in the Cloud

Salesforce.com is a pioneer in SaaS-based sales force automation solutions, no question about that. Back in 2005 when I had made my decision to only use SaaS based solutions, I had to go with SalesForce initially but we agreed in the management team that once Microsoft comes with its own SaaS-based solution, we would convert to Dynamics CRM Online. We did exactly that with the Dynamics CRM Online that Microsoft introduced to the marketplace. I am glad that I did this transition. With the new Dynamics CRM 2011 Online release, the third-party market was given the opportunity to create add-on applications whereby the use of the CRM could be extended to new functional areas.

A key element in our CRM use is a Microsoft Outlook plugin from a company called Linkpoint360 that enables us to save emails either to Account/Contact or Lead contacts. What makes this different to the very effective native tracking in Dynamics CRM is the easiness to flag things to the database. It is just one click “Record to Microsoft CRM” and you will be presented with a dialog box where you can select how you want to save it and if you want to add a follow-up action on the account/contact/lead. This solution is one of those things that you can view as a “non-brainer” and I would highly recommend to test it out and you will see that the money you pay for it is worth and the return on investment from productivity perspective is just ridiculous.

Another related technology to CRM use is marketing and email automation and we made a decision to use CoreMotives Marketing Suite that has a native Microsoft Dynamics CRM 2011 Online solution that enables tight integration to the CRM use. What it really means is that the CRM becomes “the place” to go to for everything. When we send out emails as part of the campaign, everything will be tagged inside the CRM and the analytics will give us a 360 degree view of how the campaign has progressed, how many reads the campaign message has had and what type of actions the user has taken. Very effective and what makes it also interesting is that Coremotives uses Windows Azure as the backend for the solution which is obviously something we like ISVs to do when building solutions. That is part of TELLUS educational series when making selections of technology. This is exactly the same technology that M-Files is using as it backend cloud technology.

As our business model is to work with Independent Software Vendors (ISVs) and Systems Integrators (SIs) we depend on our marketing and sales process as we apply this to both channel building for our ISV clients, sales to end user organizations but also to market our services to prospective ISVs and SIs.

With M-Files integration to our Microsoft Dynamics CRM 2011 Online with LinkPoint360 and CoreMotives we have a fully integrated lifecycle management of our entire marketing/sales process.

Research tools

My life is about research and writing and part of this process I have had to search and pick the best tools for this work. When you think about the process that one performs in research, the internet with search engine becomes one of the most important tools. The question now becomes where you save all of those links that you might need, the regular “favorites” folder in an Internet browser just isn’t enough. I ended up by selecting Microsoft OneNote 2010 as the most important tool for me to collect data and this has become invaluable to me in everything I do. Besides Microsoft OneNote, I also use mind mapping tool from Mindjet to plan and categorize things as I explained further down in this blog entry. The main tool for any of my writing is Microsoft Word 2010 that has been the foundation for two of my latest books and the third one I am working on.

Other productivity tools

Besides the operational tools that I explained above, we use a few other very handy tools when working on projects.

Graphical tools

One that has become a key and core software solution for me is Snagit from a company called Techsmith. Snagit enables me to grab anything from my current screen and reuse that image in my presentations or documents that I am authoring. Snagit has really become a core tool in any work that I do.

Mindmapping tools

Another application is a mind mapping software MindManager from Mindjet. We have used mind mapping in all of our research projects as it gives a nice overall view on the information that you are trying to portray. This has been extremely useful in our influencer intelligence studies that we have worked on during the years.

We started by using the Windows version of Mindjet, then signed up for the SaaS-based version of Mindjet called Mindjet Catalyst but realized pretty soon that it was not able to scale to the mind maps that we were building so we discontinued the use of the SaaS solution. I believe that the horsepower that this type of application takes is not really suited for a pure web-based solution seen from a usability perspective.

Presentation tools

The key presentation tool for our TELLUS workshops and events is Microsoft PowerPoint 2010. For the online video presentation we use Camtasia Studio Screen recording & Video Editing software from the same company Techsmith that is the creator of Snagit software. This software enables us to record PowerPoint slideshows with voice/and video capture with lots of different output options for different devices.

Scanning software for business cards

One of the key tasks that I do after a conference or having met a person is to scan the business card by using Dymo Cardscan 800c device with its embedded software. I have been using this technology for years, but unfortunately since it was acquired by Dymo, I have seen no developments for the software or integration to other solutions such as Microsoft Dynamics CRM 2011 Online environment. They have their own SaaS environment where you can synchronize the cards from the desktop software but that environment does not have any other integration possibilities so it remains to be seen how long I keep using this package. Once somebody invents or creates a solution that integrates well with Microsoft Dynamics CRM environment, I am ready to move over.

I will add new tools/software by updating this blog entry and in future blogs I will go in more detail to explain how each of these tools are used from a practical sense in our daily lives. I would love to hear what other tools you are using and also the use cases behind them.

Is there a Magic Number for a SaaS business?

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We have a tendency to find a magic formula for everything and this applies also to SaaS companies. In my research in this topic, I have found a few resources that give some direction of how to evaluate the healthiness of a SaaS business. It is easy to conclude that Monthly Recurring Revenue (MRR) or Average Recurring Revenue (ARR) is the driver for everything and this number is combined with Customer Acquisition Costs (CAC) we will eventually see whether the company will make money or not. If we add Average Recurring Cost per Customer (ACS) we have the main elements to figure out what the break-even point by using following formula:

BE=CAC/[ARR-ACS]

If we view the formula, it is easy for us to agree that if BE is greater or equal to 1; the company will never be profitable. In other words, Average Recurring Revenue (ARR) less Average Recurring Cost per Customer (ACS) will never be higher than Customer Aquistion Cost and that is not a good position to be in. Therefore, the ACC has to be able to cover the CAC for the company to be profitable. That is a very easy conclusion to come to. I demonstrated this in my previous blog entry where the sixth client finally was able to cover the overall CAC cost and the SaaS ISV started generating profit.

The fourth major driver is Customer Churn and this is specifically important with a SaaS business as nobody uses bad software and this will be very obvious when the customer does not want to sign up for a new contract term.  It was easier in the past when a perpetual software license was sold and the ISV got the money for it. The only thing that the ISV could lose is the annual maintenance and support fee of 15-25%. Today, an unsatisfied customer will never become profitable if walking away the first year (in typical scenarios).

A key number that seems to be a driving “Magic Number” and represent the health of a SaaS business is based on MRR growth when taking into consideration Sales and Marketing spend. The idea is that as long as the company is growing and the “Magic Number” is demonstrating that the sales and marketing spend is generating results, the company should continue on this path. The blogosphere includes a few sources in this topic and Lars Leckie was then one that came up with his blog entry that many others seem to be referring to. His Magic Formula is as follows:

QRev[X] = Quarterly Recurring Revenue for period X

QRev[X-1] = Quarterly Recurring Revenue for the period preceding X

ExpSM[X-1] = Total Sales and Marketing Expense for the period preceding X

The SaaS Magic Number = (QRev[X] – Qrev[X-1])*4/ExpSM[X-1]

Let view this formula with real numbers so we can get a feel what it means with some numbers:

 

Q1 Q2 Q3 Q4
Revenue $1.0M $1.2M $1.5M $1.6M
Sales and Marketing spend $800k $900k $1.2M
SaaS Magic Number 1.00 1.33 0.33

 

So what happens in the calculation is that the current quarter’s sales is subtracted from previous quarters sales and this is then multiplied with four (to annualize it) and then finally divided with previous months sales and marketing costs.

In the case above, the Magic Number seems to be going smoothly until Q4 when the number goes down dramatically with sales plummeting even with increased Sales and Marketing spend. According to Leckie, as long as the company maintains a ratio above 0.75 it should increase its sales and marketing spend, but if it is less than that, it should review its business as something might have changed the market condition.

Joel York takes this number a bit further by including Average Cost of Service (ACS) into the formula with the conclusion that the cost of service should be covered when calculating the Average Customer Rate of Return for the SaaS business. According to York, the Customer Rate of Return is the most powerful metric that a SaaS business can be measured on as it really shows whether the SaaS business will be a business or not. Therefore, York concludes this number (J) to be calculated in following way:

 

 

 

York also includes churn in his discussion where the growth added with churn should always be less than the average Customer Rate of Return (J). This is very logical if you think about it. The contribution from the client needs to recover the Customer Acquisition Costs, Average Cost of Service (ACS) and possible churn to achieve a situation where the customer becomes profitable for the ISV.

The common expectation is that CAC costs should be recovered in a year or so but York has put this additional requirement that the ACS costs have to be paid as well. I think this makes a lot of sense as the ACS could in some cases be considerable whereby the ISV should pay attention to them.

If we assume that the SaaS ISV has a contribution margin of 50% (Revenue less variable expenses), Joel’s Magic Number would be as follows:

When Contribution Margin = 50%

Joel’s SaaS Magic Number = The SaaS Magic Number /2

York takes a more conservative approach in his numbers where he concludes that The SaaS Magic Number of 0.75 just is not enough to “step on the gas” as the needed growth requires aggressive spending which then moves the SaaS ISV further down in time to profit scale. If we furthermore assume that the contribution margin (CM) is anything less than 50%, the time to profit is much longer specifically in start-up phases. York wants to see a Magic Number that is more or equal to 1 with the added requirement that ARR is > 2 x ACS whereby the ISV can quickly recover its acquisition costs.

We can conclude from this blog entry that the SaaS world does have some metrics to measure the health of the operation, and there are many perspectives how each analyst sees it: some view it from more conservative perspective and some have their venture capitalist perspective. The latter is very prevalent in the blogosphere and many of the SaaS authorities are from this domain. It is easy to say that they might not always represent the view of the entrepreneur, but more from an investor perspective and we all know what that means. It will be interesting to see if more entrepreneurs will provide guidance in this field like Josh James, CEO of Omniture gave at a conference and this generated the blog entries from both Leckie and York. Interestingly, Omniture was sold to Adobe and left the company soon thereafter.

Once we get enough people sharing their experiences in different aspects of the cloud business, we will eventually achieve a situation where we can provide guidance in metrics for different types of SaaS vendors.

Cloud as foundation for innovation: Are you willing to take your company outside your own comfort zone when innovating products?

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I got the burst and desire to write this blog entry after having read an article about Microsoft and Toyota forming a partnership to develop new IT-based services for electric vehicles when to recharge. Think about it. In the future, the cloud will become the place that connects devices and vehicles and if this is not an opportunity for ISV’s, what is? Also, when you add mobile solutions to this formula of the cloud, you have something that can become big and create a new market for the ISV.

I will never forget the day when I was sitting in an advisory panel with other software executives when one of the participants from a large software company suddenly said with a loud voice to the entire group: you are looking at your business inside the box, not from outside. That was the first time when I had a real wakeup call how the cloud can change not only our lives, but also how products are innovated and how we can make a difference with software.

The cloud has unfortunately lots of hype around it, but many Independent Software Vendors (ISV’s) such as M-Files (Motive Systems) has taken Microsoft Azure as an enabler of new opportunities and not just as an “object for migration”. M-Files is the first Document Management Solution that is built using Windows Azure as the foundation with tens of thousands of users around the world. Windows Azure provides a scalable and robust platform for an ISV to build solutions that can be distributed around the globe.

Anybody can migrate to the cloud, but the winners are the vendors that really look at the current business model and make something bigger of it like what M-Files decided to do. As a software vendor, M-Files will rely upon Microsoft to build data centers and infrastructure to these centers and the role of M-Files will be to innovate on top of this infrastructure. Windows Azure and SQL Azure are part of a Platform-as-a-Service environment (PaaS), but without an application Windows Azure is just infrastructure and there is nothing that you can do with it. Microsoft relies on Independent Software Vendors (ISVs) to build applications that can then be deployed to the Azure cloud and be part of the Windows Azure Marketplace or Windows Azure DataMarket with the possibility to accelerated sales. Other solutions such as Dynamics CRM 2011 Online are positioned to another category (SaaS) and can be consumed “as is” or by customization by the company or a System Integrator (SI).

ISV’s are living in turmoil. Some of them have built solutions for years with an architectural model that will be hard to move to any cloud infrastructure even if there was a desire. There are many alternative ways to make the transition, and one of them is to do a gradual move by building extensions that utilize the cloud and this gives the ISV the taste of the cloud and what it really is to develop to that environment. Sometimes the architectural model just is meant to be for the cloud and those are the lucky ones that are typically in the minority.

Having travelled the world, having seen hundreds of ISV’s, I am convinced that the ones that do not even have a transition plan will have huge issues going forward. I have analyzed the situation from System Integrator (SI) and Independent Software Vendor (ISV) perspective and I have to say that both groups will benefit from the cloud if positioned correctly. The former can serve the latter in the transition and the latter should be thinking and innovating outside the box. Think big, do not think about migration, but think about things that you were not able to do in the past that you can do now. Ulf Avrin provides advice in his blog entry in the transitioning to the cloud and what types of changes one can expect in the transition.

Do you have a transition plan in place and are you going to benefit of the cloud?

Former Nokia CEO Kalle Isokallio is wondering about the fuss in Finland concerning Nokia and Microsoft collaboration

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In today’s Finnish Iltalehti, the former CEO of Nokia Kalle Isokallio criticizes both Finnish politicians as well as other critics that do not see the opportunity of this new partnership that Microsoft and Nokia has created. Isokallo wonders how all these skilled Symbian developers would be worse off when given modern and more productive software product development tools when compared to that of Symbian’s. He uses a metaphor in the comparison between Symbian and Microsoft development. Assume that you are building house. Which tool is better: a Leatherman knife or axe and chainsaw. With the first one you will end up with a house eventually, but with the latter, you get results much quicker as your productivity is better.

Isokallio also wonders whether he is the only one in Finland that sees this as an opportunity and wonders why politicians and labor unions refuse to see the bright side of this. Nokia did not have a future the way they were going, and this new path gives all Symbian developers, the ones that want it, a new future.

I think Isokallio brings a valid perspective to the wild discussion in the Internet about the pros and cons of this new partnership. Isokallio concludes that the future is less about hardware, but the ability to provide one consistent view to the application that is consumed from the web. Consumers are no longer willing to have different user experience between different devices if they use the same application and I have to agree on this. If a billion consumers use Windows as the operating system, doesn’t it make sense to have a consistent user experience with a mobile device that looks and feels that same. I think it does.

Also, what I did not think about before was that maybe Nokia will be the one providing the tablet experience and hardware, not Microsoft. I think we can expect to see a Windows tablet from Nokia, the only question remains whether it is the upcoming Windows 8 or Windows Phone 7-based tablet. My guess is the first one.

Isokallio also concludes that the relationship between Nokia and Microsoft has something that Apple does not have and that is the cloud as I also concluded in my prior blog entry . Nokia now has access to one of the largest cloud vendors (Windows Azure) in the world and all of the developers that build solutions to Windows Phone 7. That did not exist with the Symbian development environment. Visual Studio provides tight integration to Windows Azure and Windows Phone 7 (out –of-the-box) so developers can focus on building the solution, not supporting infrastructure.

Microsoft has something that Google does not have and that is an operating system that everybody uses. Yes, Google is working on its own Android operating system, but if a billion consumers use Windows today, that is where the market is for time being. Google has the cloud but users will still want to use their productivity tools and provide seamless integration between different devices.  Apple has its operating system and iPhone and tablet (iPad), but the market share of iOS is still very low in enterprises.

Finally, Isokallio concludes that the ridiculous amount that Nokia paid for Navteq (5,7 billion Euros) might not seem so ridiculous anymore when the technology is combined with Bing technology. Bing market share has increased considerably and Microsoft is eating into Google’s market share and profits. Recently, there have been reports that Bing search results are even more accurate when compared with that of Google’s. I think that is irrelevant as of now. What is relevant is who provides a consistent user experience in business and personal lives and Microsoft has a new chance doing this with its Windows Phone 7, Zune, xBox 360,  Windows Live, Office Live and other similar services that will be integrated.

I really enjoyed Isokallio’s article (in Finnish) as he brings valid points to the discussion and his background as Nokia’s CEO gives him some perspective and validity to his opinions.

Do you agree what Isokallio is saying?